A jail won't work for not-root users if the jail root directory is chmod 700 - although
there is obviously a 'chroot' running withing the jail, the jailed user still needs
to have read permission from the hosts / -- chmod 700 therefore locks all non-root
users out.

It's weird - I don't remember having such problem after setting jails'
root directory permission to 700. I don't have the system anymore so I
can't verify it just yet.

It should also be noted here that the jailed root user also has permission
to chmod(1) '/' to anything he or she wants unless you have taken
precaution to not allow that. I would reccoment storing your jails two
levels deep into a directory and chmod(1) 700 the first level to prevent
access from the host and from the jailed root user changing the perms.

Possible security issue with jails... I'm not sure if this is actually an issue, feature or a bug, but I have found ... the jailed root user is able to sniff traffic (and enable ... promiscuous mode) on at least the interface of the IP address the jail is attached ...(FreeBSD-Security)